Why the ETF overheated debate and the SEC the Bitcoin kind’s

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In recent weeks, the debate on a possible Bitcoin ETF approval and their decision has led to date to heated discussions. The dried-crypto-market is a thirst for new liquidity, the ETF approval by the U.S. securities and exchange Commission SEC. A Bitcoin ETF for crypto investors promises a new Rally, however, see people who dedicate themselves to the technology and against a regulated crypto-market is a failure in development.

If you have heard in the last weeks of Bitcoin in the crypto-media, then it was mainly about the Bitcoin ETF applications have been submitted by several participants of the financial market to the US securities regulator, the SEC. So far, all applications with respect to a stock exchange have been rejected-traded index Fund of the authority. The hope that it might work in the next decision dates in the next few weeks, not only supported the Bitcoin rate, but also awakens the sleeping greed of many crypto investors and those that want to be there.

Ethereum-head Vitalik Buterin flexed against crypto-ETFs

Contrary to the short-term positive implications, which some investors yearn for, but votes against, want to hear from a Bitcoin ETF, nothing. So, Vitalik Buterin, the well-known mind behind Ethereum has expressed unequivocally critical of crypto ETFs. The original Motivation behind Bitcoin, the currency function and the associated global Adaption as a payment medium. The over-Emphasis of the investment cases by ETFs does more harm than good, distracting currencies but the focus away from the actual functions of the Crypto.

ETFs as a threat to the crypto-adaptation

The justification is to be seen not as a purely idealistic. Also substantive arguments, in particular of a technical nature, to speak in a crypto-ETF approval. One is reminded of the Hype Phase at the end of 2017, then it becomes clear what the dangers of a huge inflow of funds in a short period of time to go out. The entire crypto-Ecosystem collapsed under the enormous glut of transactions more or less. Exchanges could only offer a restricted service, the transaction times and costs shot up due to a lack of scalability, and the security shortcomings of the cryptographic service provider is severe.

Certainly has done much, and some of the grievances have been cleared out of the way. The scaling of Bitcoin and Ether, however, is hardly more than at that time. Although there are now Second-Layer solutions, such as Lightning, but these are still much to impractical to be used in the width. So the Big Money should be flooding through ETFs in a short time the market, then tongues are Overheating of the Ecosystem, especially in the scalability, cannot be ruled out.

What is the WKN of Bitcoin?

In addition to the burden on the Ecosystem of crypto-criticize-the purists, the one-sided visibility with the General Public. If Bitcoin is reduced to regulated funds and certificates, is detrimental to the fundamental understanding of the crypto-Economy. If a securities identification number (WKN) is a Bitcoin-Fund, the custodian, the house Bank is posted, then this is in absolute contradiction to the Bitcoin White Paper. It would be a certain Re-centralisation, which again banks to the Central administrator of assets. The Narrative of “Be your own Bank” is guided by it to the point of absurdity. No one needs to know for a Bitcoin ETF, what is a Wallet or a Private Key – the responsibility lies solely with the regulated financial service provider.

Non-crypto-purists will see this exactly the opposite. Their reasoning is that an ETF lowers the crypto threshold, so the willingness of the width of promotes, at all with Bitcoin and co. deal with ETFs as a gateway drug for Non-crypto-Savvy.

Keep Cool

Bitcoin ETF or not – there are reasons that speak both for and against a ETF approval. Clearly, however, must be: crypto-ETFs will definitely come. The only question is how fast. Accordingly, it can be quite positive, if the SEC gives the current crypto-ETF requests a basket, so that the crypto-Ecosystem gets more time for its infrastructure to further expand and stabilize. It can speak of luck that the Hype Phase at the end of 2017, no ETFs were approved. It would have been in 2017, Bitcoin ETFs, would have been the Overheating and subsequent case, the amount is even greater.